After yesterday's rather smooth and sluggish weakening of the pound, its current growth, and quite fast, seemed to be a matter already resolved. Moreover, the forecasts for the labor market in the UK were extremely optimistic. That's just the data themselves turned out to be much better than forecasts, but there was no rapid growth of the pound. Although the unemployment rate, instead of remaining unchanged, decreased from 4.6% to 4.5%. Employment increased not by 225,000, but by 235,000. Nevertheless, the market behaved as if nothing had been published. Of course, the pound, supported by truly excellent data on the labor market, will show growth, but it will be very stretched, and at best, it will become noticeable only by the end of the trading day. At the same time, it is unlikely that the pound will be able to return to yesterday's highest values. After all, the trend of strengthening the dollar has not gone away. Last Friday, the market even received additional confirmation that the process of strengthening the dollar is very far from completion.
Unemployment rate (UK):
The GBPUSD pair is still following in the structure of the corrective move, where the 1.3620/1.3650 price area serves as a resistance. Based on the logical basis of the past, there is a systematic reduction in the volume of long positions, which may signal the completion of the correction.
The technical instrument RSI in the four-hour period follows within the 50 line. This signals stagnation, which is confirmed on the chart by the movement of the quote along the resistance area.
Despite the stage of correction, the market is still dominated by downward interest. This is indicated by a stable downward trend from the beginning of June.
Expectations and prospects:
It can be assumed that the movement in the area of the resistance level will remain in the market for some time. This will lead to the accumulation of trading forces, where, according to the results, the work will be carried out on the basis of the breakdown method. In simple terms, the correction is replaced by a flat in the 1.3540/1.3670 range.
Comprehensive indicator analysis gives a buy signal based on short-term and intraday periods due to price movement at the peak of the corrective move. Indicators of technical instruments in the medium-term are focused on a downward cycle, signaling a sell.